I recently read an article on The Verge - which is my favorite tech blog - about how Microsoft is re-branding it's Zune music service to leverage its Xbox brand (article here). The change in branding makes a huge amount of sense, since MSFT is no longer producing Zune branded hardware, but it also got me asking, "Why would they be converging all of their products to 'XBox Live'?" Let's look into the history a bit...
The original Xbox was code-named "DirectX box" and subsequently shortened to Xbox before it was released in 2001. Primarily billed as a standalone gaming system, the Xbox was released to the market and represented the pinnacle of graphics technology for its time. Shortly after launch, Xbox LIVE was released, making over-the-network multiplayer gaming possible. Fast forward to November 2005, the Xbox 360 was released and along with it, the Xbox LIVE multiplayer services.
We got our first glimpse of the Xbox LIVE that we know today at the end of 2007, when Windows Live Messenger was added to the Xbox LIVE service. Soon after, many of the features that we associate to Xbox were integrated into the service, such as video/music streaming and download, social integration, live chat, and much more. Most recently, the Xbox LIVE has popped on it's Windows Phone operating system, bringing multiplayer gaming and communication features to their mobile device platform.
Ok, so what's your point?
If you think about it, in the consumer gaming world we are reaching a point of diminishing returns when it comes to graphical improvement. Yes, you could throw lots of insane hardware at the equation and get trillions of polygons rendering each nano-second, but I would argue that improved graphics wouldn't have a huge impact on consumer platform choice. I say this purely because the average consumer will not be able to discern between the same game between Sony's PS3 and Microsoft's Xbox 360. That being said, the platforms need to differentiate themselves in other ways. This concept easily explains the success of gaming systems like the Nintendo Wii, which had sub-par graphics capabilities, but differentiated itself by it's interface. For MSFT with it's Xbox, the differentiator is Xbox LIVE, and they are milking it for all that it is worth.
There is a trend here that is tipped off by the Zune announcement: everything is being bundled and branded into Xbox LIVE. What started off as a pure gaming device (the original Xbox) has morphed into a full multimedia device (Xbox 360), all the while having the core of a PC. You can watch a Hulu or Netflix movie, download music, stream a playlist for a party, have a conversation with a friend around the world, and the list goes on... all through your Xbox. It isn't a very long stretch to imagine Xbox LIVE being re-branded into Xbox Life, or just Xbox. The name is generic enough, isn't it? An X-box could be anything! The Xbox already integrates with your home network to share files, but if they add Bluetooth or some other mid-range wireless communication protocol to the hardware, it can then communicate with any compatible devices in your home.
It isn't too far fetched to imagine Kinect controlled room-lighting, room-specific thermostat controls, or even home security integration. Also, considering it is a networked device, giving access to this kind of information to it's owners from mobile devices would be an extremely powerful tool. I can't imagine this being too far from the future and if anyone in the world has the scale and hardware/software know-how, I'd say it's the boys and girls in Redmond.
If my prediction is true, you know who called it first!